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Personal Loans Canada – What You Need to Know

A personal loan can help you pay for any number of expenses, including a big purchase or a financial emergency. It can also be used to consolidate debt or merge existing debt into one lump sum. Unlike credit cards, which have a variable interest rate based on the Prime Rate1, a personal loan offers a fixed rate for the entire life of the term.More info:

Online personal loans are becoming increasingly popular among Canadians who want to escape the payday loan cycle, consolidate debt or build a positive credit history. They are also more convenient and offer a level of anonymity that may be desired by some people who don’t feel comfortable walking into a bank to ask for money.

However, the process of obtaining a personal loan is not as quick or easy as going into a brick-and-mortar bank. Online lenders often require a higher credit score and may not always offer as much flexibility in terms of use or the ability to change your terms mid-term.

Credit Health Matters: How Personal Loans Can Impact Your Financial Well-Being in Canada

Fortunately, online personal loan companies like Spring offer an alternative option that can be easier to obtain and is often faster than going into a bank. Plus, online lenders don’t discriminate against those with a bad credit history and can approve applicants that banks may reject due to collection activity, divorce or new to credit, among other reasons.

The latest Finder: Consumer Sentiment Survey Q2 2023 showed that people with a lower credit score are more likely to choose an online lender for a personal loan to cover an expense or financial emergency. To apply for a personal loan through an online lender, you need to be the age of majority in your province or territory, have a source of income, and agree to a credit check.

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